A tricky agenda for Nandan Nilekani and for Infosys…   

• The leadership structure needs to be a little clearer. For now, Infosys is going ahead with Pravin Rao as interim CEO, but that is not a permanent solution. Also, a new board has to be constituted with a great degree of urgency.

• Throughout most of its history, Infosys has had the benefit of a weak Indian rupee. That was a natural advantage to Infy’s global growth. With Indian GDP growing at 7.5% and India attracting record FDI inflows, Infosys may now have to contend with a strengthening rupee.

Nandan will have to drive Infy’s big shift towards the digital business. As the man who literally drove UIDAI, that is today the basis for inclusive banking, you cannot hope for a better man for the job. Infy also needs to catch up on lost ground vis-à-vis TCS in this space.

A BEGINNING IS MADE ON PSU BANKING MERGERS…

      The Cabinet on August 23rd gave an in-principle approval for initiating the process of merger of PSU banks. The idea has been under discussion for the last few months and the reasons are not far to seek. Firstly, there is a lot of duplication in the network and operations of most of the PSU banks and hence having so many banks did not add much value. Secondly, banking is increasingly becoming a business that is technology driven and less dependent on geographical presence. Therefore, having so many PSU banks with presence across the length and breadth of India was not required. Lastly, if PSU banks have to survive they need size and a solid balance sheet. In the current situation, this is difficult on a standalone basis considering the weak credit growth and high level of NPAs. The answer lies in merging these PSU banks into smaller clusters to make them more nimble and more competitive. It is in this light that the Cabinet approval needs to be seen.

                                                                                                                                Source:-Angel broking Blog.

 

WHY THIS IPO BOOM MAY ACTUALLY BE DIFFERENT?

        The Indian IPO market helped raise nearly $2 billion during the financial year 2016-17. It is estimated that in the coming year 2017-18, the IPO market will help raise nearly $5.5 billion worth of fresh money. IPO booms are nothing new to India. We have seen IPO booms in 1992, 1994, and 1999 and again in 2007. Each of these IPO booms resulted in excesses in the market and eventually ended up destroying wealth of investors. That is why, as the IPO market has picked up over the last 2 years, the question of whether we are again sitting on an IPO bubble is back in circulation.                                                                                           

                                                                                                         Source:-Angel Broking Blog.

                                                                                                                                 

DYNAMIC FUNDS: WHAT YOU NEED TO KNOW ABOUT THEM…

    A dynamic fund is a recent innovation to the battery of products that mutual funds have been offering to customers. Conceptually, it is almost similar to a balanced fund as it entails a mix of equity and debt in its portfolio. But that is where the similarity ends. A Dynamic Fund is a lot more aggressive in concept as the fund manager has much more leeway to shift the asset allocation either in favour of equity or debt. Here is how it works…

ARE WE UNDERESTIMATING THE ROLE OF TRADERS IN THE STOCK MARKETS?

   How exactly do you define a trader in markets? Frankly, there are no hard and fast definitions but a trader typically tries to move in and out of markets to capitalize on opportunities. Essentially a trader has a short term perspective. This can range from a single day to a couple of months but the role of a trader needs to be understood as distinct from an investor who typically allocates money for the longer term. It is quite normal for traders to bear the chunk of the blame when the markets crash. It is often alleged that overtrading or short-selling by traders led to bubbles which eventually led to value destruction in markets. While this could be partially true, it is also largely unfair to traders. The focus here is to dwell upon some very important functions that traders perform in ensuring the safety and robustness of the market. Remember, while our focus here will be on the equities market, the role of traders is similar in commodity, debt and forex markets too.

                                                                                                                      Source:-Angel Broking Blog.